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Manhattan Associates identifies five potential pitfalls
By Christmas morning, Britain's 24 million online shoppers will have spent 7 billion in an unprecedented online Christmas shopping spree spanning the ten weeks prior to the big day.
This is 40% more than during the same period last year, according to Interactive Media in Retail Group figures. Consumers will also continue to buy presents on the high street, via mail order and through call centres. Retailers face the growing challenge of providing customers with the same service level wherever they choose to shop. Back-end systems are often ill equipped to service the multi-channel consumer, leading to significant supply chain challenges.
Manhattan Associates, leader in supply chain solutions, offers retailers five key tips to avoid the obstacles that might dampen their festive cheer during this busy period.
Visibility It can be hard to manage and consolidate stock across the web, catalogues, shops and TV channel sales. This is further complicated by the difficulty of predicting this year's gift trends and reacting to them swiftly. Recognising recurring seasonal buying patterns and distinguishing between fast and slow moving items are first steps in the right direction.
Productivity Inventory planning through complex spreadsheets is labour-intensive and drives down productivity. Warehouses are not always laid out for the fast picking models of e-commerce and catalogues, making processes inefficient and expensive. Another productivity pitfall is letting store staff handle orders for other channels. It is far more effective for staff to focus on their own channel's orders, minimising confusion and improving productivity.
Customer service The busy December period can lead to order backlog, delays and cancellations. Separating picking from packing can provide added value by freeing up staff to offer wrapped or personalised presents for web shoppers. It is also important to provide frequent updates on the status of orders as slow and complex processes can harm relationships with customers.
Profit erosion Overstocking is a commonly used method for handling demand surges. However, the surges are often followed by heavy discounting to shift excess stock and high storage costs of old inventory. Efforts must be made to identify the fastest and most cost-efficient delivery methods. Efficient processes for return articles are also important and ensure that products are not taken back outside of the warranty period, for instance.
Management Warehouses can become too full and function badly because of this. Systems to deal with the storage and picking of additional stock brought in for Christmas are essential if warehouse chaos is to be averted. The festive period also inevitably results in a large number of returns, which can further hamper the smooth operation of the warehouse if not carefully managed.
About Manhattan Associates, Inc.
Manhattan Associates is a leading supply chain solutions provider. The company's supply chain planning, supply chain execution, business intelligence and business process platform capabilities enable its more than 1200 customers worldwide to enhance profitability, performance and competitive advantage.